Advantages And Disadvantages Of Bayesian Analysis

Decision making is the process of examining possibilities options, comparing and choosing a course of action. Making effective decision, as well as recognizing when a bad decision has been made and quickly responding to mistake. Some experts believe that decision making is the most basic and fundamental of all managerial activities. Every organization will have a decision maker who is a manager in each management. A good manager will make decision making based on the data from the surrounding them. Bayesian analysis is one of the models in risk assessment to help the manager in made a decision. Bayesian analysis is needed because the sources of this analysis are probability that usually exist in process or project. This paper is to highlight how Bayesian

Defining the problem: The first thing that has to do is to state the basic problem that has to be solved.

ii. Develop alternatives: After defining the main problem, you have to state out the alternatives for the solution. Here you can use your creative skills and come out with alternatives that may look a little irrelevant.

iii. Evaluate the Alternatives: This is the important stage in the decision making process. By analyzing each alternative, you can find the advantages and disadvantages of each option.

iv. Make the decision: This is the stage where you have put in analyzing would lead to. The evaluation process can help you to pick the most applicable alternative.

v. Implement the Solution: Taking a decision is important, but more important is the implementation. And this is a very important step because the people involved in the implementation of a solution should know about the implications of making a decision.

vi. Monitor the Solution: You have to keep monitoring the progress of the solution taken and also whether it has led to the results you expected. The feedback has an important role in evaluating the decision in the light of the outcomes achieved as a result of its implementation (Kartha,